November 21, 2011 / 1:48 AM / 6 years ago

EU's Barnier: Tougher rules must precede euro bonds

1 Min Read

PARIS (Reuters) - Michel Barnier, the European Union's markets commissioner, said on Sunday he was in favor of euro zone countries pooling their debt together but warned that tougher oversight of national budgets was needed first.

The European Commission will suggest on Wednesday that it take on new powers of oversight of national budgets in exchange for accepting that euro zone members issue debt jointly through so-called eurobonds, EU sources told Reuters this week.

"The precondition for shared bonds, for common debts, which to me seems like a fair idea, is to have coordination, oversight, common governance and a larger European budget," he told France 5 television in an interview.

Asked if Germany, which is opposed to the idea of eurobonds, would make concessions on the idea, he said: "Germany will move as soon as it has confidence in our capacity to manage the economy together."

Reporting By Nicholas Vinocur; Editing by Kavita Chandran

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